Standard Life Bank being sold to Barclays? What would happen to mortgage customers?

lilac_lady

Barclays are shedding nearly 300 Standard Life Bank workers in Edinburgh so more than those of you who have their mortgage with them have been shafted.

opinions4u

lilac_lady wrote: »

Barclays are shedding nearly 300 Standard Life Bank workers in Edinburgh so more than those of you who have their mortgage with them have been shafted.

You hit the nail well and truly on the head.

The mortgage rate before the takeover? 4.99%. The rate now? 4.99%.

It's fairly clear who the biggest losers are. It ain't the customers (many of whom could remortgage).

dunstonh

ive found a great way to reduce the effect of the criminal standard life SVR.

The rate isnt criminal so you must be referring to a product that is for criminals.

its just another way we are being shafted - there are too many companies making money at our expense in the current climate.

Who would ever have thought you get someone accusing a company of making money at their expense on a 4.99% SVR.

leicsmark

There seems to have been a few misinformed posts here.

The Standard Life SVR is 5.34%, the Barclay's SVR is 4.99%. Since the takeover we have had very little information from Barclay's or Standard Life. We are unable to utilise Barclay's facilities (branches, online, phone) and instead still deal with the same call centre in Edinburgh (who are very good by the way - shame they are being disbanded).

We are also unable to take advantage of any remortgage offers with Standard Life (there isn't any- and hasn't been for about 18 months) or Barclay's.

What is unfair is the rate of 5.34% is way above the market average, and seems unfair when you look at the margin above the Bank of England base rate. Yes, historically this is not a high rate and in 2007 this would be an excellent rate. Times have changed, and there is a huge disparity in the rates people are paying. 5.34% is high for an SVR in 2010, more than DOUBLE that of Nationwide etc. and no amount of historical perspective will change that fact.

Secondly, Barclay's are operating TWO SVRs and this seems inherently unfair when Standard Life is now entirely part of Barclay's. Who decides the SVRs? Is the SVR ever reviewed? Is it a fair reflection of the cost of servicing these mortgages? Why have Barclay's reduced "Standard Life's" savings products by around 0.5% in recent weeks but are happy to ignore the inherited SVR from Standard Life's board.

I am currently considering an offer from Britannia for an 85% mortgage deal after overpaying by £400 per month (monthly cost £1400) and reducing my balance by £6000 in a year. I am delighted to be leaving.

Anyone else managed to jump ship?

opinions4u

leicsmark wrote: »

The Standard Life SVR is 5.34%, the Barclay's SVR is 4.99%. Since the takeover we have had very little information from Barclay's or Standard Life.

What do you expect? Your mortgage remains with Standard Life Bank which is a subsidiary of Barclays. They're not going to build a special waterslide outside your house to help you get work quicker just because they've taken over Standard Life Bank.

We are unable to utilise Barclay's facilities (branches, online, phone) and instead still deal with the same call centre in Edinburgh (who are very good by the way - shame they are being disbanded).

Again, what did you expect? Lloyds TSB customers can't walk in to Halifax branches and use their facilties. Barclays customers can't ring the Standard Life call centre to talk about their mortgage. Nobody can ever ring a Santander call centre and expect to get any sense (although that's a competely different issue).

We are also unable to take advantage of any remortgage offers with Standard Life (there isn't any- and hasn't been for about 18 months) or Barclay's.

They're not obliged to offer you anything.

What is unfair is the rate of 5.34% is way above the market average, and seems unfair when you look at the margin above the Bank of England base rate.

They don't raise their money at BofE base rate. It's not relevant. To have an "average" there are usually higher and lower numbers involved.

Yes, historically this is not a high rate and in 2007 this would be an excellent rate. Times have changed, and there is a huge disparity in the rates people are paying. 5.34% is high for an SVR in 2010, more than DOUBLE that of Nationwide etc. and no amount of historical perspective will change that fact.

Nationwide lose money on their foolish commitment to charge borrowers 2.5%. They don't maintain that commitment for new borrowers, by the way.

Secondly, Barclay's are operating TWO SVRs and this seems inherently unfair when Standard Life is now entirely part of Barclay's.

Lloyds TSB have 2 SVRs of their own. Halifax has an SVR. Intelligent Finance does something differently too. Birmingham Midshires has sharply higher SVRs. All part of the same company. Nationwide has an SVR for old borrowers and and SVR for new ones. Alliance & Leicester customers pay more than Abbey customers, depsite being part of Santander.

Wholesale funding rates for Standard Life Bank mortgages are probably higher than funding costs for Barclays mortgages. Hence they charge a higher rate to reflect this.

Who decides the SVRs?

The lender. As you agreed to when you borrowed from them.

Is the SVR ever reviewed?

I would think so. If they want to get rid of customers they charge more. If their funding costs increase, they charge more. If they want to retain customers they charge less and offer good value alternatives.

Is it a fair reflection of the cost of servicing these mortgages?

It probably is. I don't know what their bad debt and funding position is, but the rate charged suggests they aren't doing too well.

Why have Barclay's reduced "Standard Life's" savings products by around 0.5% in recent weeks but are happy to ignore the inherited SVR from Standard Life's board.

Because they want to improve the profitability of their new subsidiary? They want to offset losses that may be occurring on certain parts of the mortgage book? Has it crossed your mind that Standard Life sold their bank because it was struggling?

I am currently considering an offer from Britannia for an 85% mortgage deal after overpaying by £400 per month (monthly cost £1400) and reducing my balance by £6000 in a year. I am delighted to be leaving.

Which is the logical thing to do.

Interestingly, Britannia have an SVR of 4.24%. This is a massive 1.74% over Nationwide's old SVR. Why would you willingly sign up to such a poor SVR in future, after being so frustrated by Standard Life/Barclays? I think it's above the market average too!

Lawman29

As far as I know Barclays will close down the SLB operation at the end of this year. I have most of my mortgage on a 10 year deal (5.74 the worst decision I ever made) expiring 2014 and the remainder on their SVR of 5.34 %. What if anything would happen to the deal / SVR. I would expect the deal to stay as is.